Exports of coal, aluminium bars and power fell sharply in the first quarter of 2023 because of the fall in commodity prices in the international market. Still, the value of total exports registered slight growth in the period under review.
Data compiled by the Bank of Mozambique said that the prices of the main commodities continue to fall, reflecting the prospects of slower growth in the world economy. As a result, domestic exports fell due to a drop in the prices of thermal coal and aluminium, which is justified by an increase in the supply of these commodities on the international market, driven by consumption in China.
Exports of aluminium bars, mineral coal and electric power fell, by USD 141, 80 and 9 million compared to the first quarter of 2022 when exports of those products reached USD 396, 541 and 141 million, respectively.
Despite the price drop in the international market, the Central Bank reveals, in a Report on the Economic Environment and Inflation Prospects, published a few days ago, that total exports registered slight growth.
“In the period under reference, the value of exports of goods increased compared to the same period of 2022, by only USD 4.4 million,” the Report reads. Contributing to this slight growth were natural gas and sands, whose exports grew by USD 252 and USD 3 million compared to the first quarter of 2022 in which exports stood at USD 89 and USD 118 million.
While exports grew, this did not happen with imports, which fell by just over US$4 billion, which contributed to an improvement in the balance of goods. According to the document, the substantial reduction in the value of imports is justified by the significant value of the floating platform of the Coral Sul project (around US$4.2 billion), registered in the first quarter of 2022.
In terms of products, in addition to the fall in machinery imports, data from the Report reveal that imports of construction material and raw aluminium also fell by USD 18 and 14 million respectively. In the first quarter of 2022, imports of these products stood at USD 152 million and USD 127 million respectively.
However, contrary to the downward trend, imports of fuel and automobiles grew by USD 135 and 13 million respectively (despite the decline of Brent on the international market). In the first quarter of 2022, imports of these products cost USD 246 and 89 million respectively.
As for fuels, the Bank of Mozambique forecasts continued slowdown in the price of Brent and wheat, reflecting contained global demand and prospects for increased production in the United States of America and Russia, respectively.
“For 2023, the outlook continues to point to the convergence of Brent crude and food prices to pre-Russian-Ukrainian conflict levels,” the Report on the Economic Environment and Inflation Outlook stresses.
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